North Dakota landowners' lawsuit against pipeline dismissed

Friday

Oct 13, 2017 at 12:01 AM

By BLAKE NICHOLSON, The Associated Press

BISMARCK, N.D. — A federal judge has dismissed a lawsuit filed by nearly two dozen North Dakota landowners who alleged the developer of the Dakota Access oil pipeline and a consultant used deceit and fraud to acquire private land easements for the project.

But a court case in Iowa involving the pipeline and landowners is expected to linger into next year.

In North Dakota, U.S. District Judge Daniel Hovland in a ruling dated Tuesday sided with a subsidiary of Texas-based Energy Transfer Partners and Contract Land Staff, a land acquisition consulting business also based in that state. The two companies disputed that the landowners had any valid claims, and Hovland also found their arguments lacking.

"The court finds that the plaintiffs have clearly failed to specifically allege who made the fraudulent statements, when the statements were made, and to whom the statements were made," the judge wrote.

The $3.8 billion pipeline began moving North Dakota oil through South Dakota and Iowa to a distribution point in Illinois June 1.

The 21 North Dakota landowners sued in January, seeking more than $4 million in damages for what they called "misrepresentations, deception or other unfair tactics."

They alleged the Texas companies engaged in fraud while negotiating to lay pipeline on private land, resulting in compensation that was as much as nine times lower than what other landowners got. They also alleged they were told if they didn't agree to the offered amount, they faced losing money or getting nothing either because their land would be condemned through eminent domain or the pipeline would be moved elsewhere.

Hovland ruled the landowners didn't adequately prove their claims of wrongdoing, and he said it's impossible to know whether they might have received a better deal under other circumstances.

"The plaintiffs are upset their neighbors got a better price when the agent predicted prices would never be better," the judge wrote. "However, the court finds that opinions and predictions as to what future prices will be are simply not actionable as fraud."

Attorneys for the landowners did not immediately respond to phone and email requests for comment Wednesday and Thursday.

The landowners who sued represent only about 3 percent of the 800 North Dakotans who provided easements for the pipeline, according to ETP, whose attorneys called allegations "essentially a case of sellers' remorse."

Spokeswoman Vicki Granado said in a statement to the Associated Press that the company is guided by principles including "communicating clear, timely, and accurate information, and following the rule of law."

In Iowa, a case filed by a group of landowners and an environmental group is on appeal to that state's Supreme Court after a judge rejected their arguments in February. They challenge the Iowa Utility Board's decision allowing the pipeline company to take their land under eminent domain.

The appeal also alleges the board refused to consider the need for, or benefits from, the pipeline. State law requires the board to approve pipeline projects only if they promote public convenience and necessity. Arguments are expected early next year.